Ausnorth Feeds Pty Ltd as Trustee for the Farm Markets Trust
[2016] FWCA 1215
•5 April 2016
[2016] FWCA 1215
DECISION
| Fair Work Act 2009 |
| s.185—Enterprise agreement |
Ausnorth Feeds Pty Ltd as Trustee for the Farm Markets Trust T/A
Jonsson’s Farm Market
(AG2016/2131)
JONSSON’S FARM MARKET (ABN 19 114 242 607) ENTERPRISE
BARGAINING AGREEMENT 2016
Retail industry
| DEPUTY PRESIDENT BULL | SYDNEY, 5 APRIL 2016 |
Application for approval of the Jonsson’s Farm Market (ABN 19 114 242 607) Enterprise
Bargaining Agreement 2016.
[1] An application has been made by Ausnorth Feeds Pty Ltd as Trustee for the Farm
Markets Trust T/A Jonsson’s Farm Market (the applicant) for the approval of an enterprise
agreement known as the Jonsson’s Farm Market (ABN 19 114 242 607) Enterprise
Bargaining Agreement 2016 (the Agreement). The application was made pursuant to s.185 of
the Fair Work Act 2009 (the Act) and is a single enterprise agreement.
[2] The Agreement covers all employees engaged by the employer.
[3] The General Retail Industry Award 2010, Meat Industry Award 2010 and Road
Transport and Distribution Award 2010 (the Awards) are the relevant reference instruments
for the purposes of the better off over all test (BOOT) as required under s.186 of the Act.
[4] The Agreement provides base rates of pay which are higher than the corresponding
minimum rates of pay under the Awards, being:
| | 2.17% to 2.70% higher for retail employees; |
| | 1.32% to 1.36% higher for meat employees ; and |
| | 1.39% to 1.42% higher for road transport employees. |
[5] Employees paid base rates are entitled to payment of annual leave loading, shift
penalties, overtime payments for work additional to their ordinary hours which is performed
under the employer’s direction and public holiday penalties. Where additional voluntary hours
are requested, employees’ time is paid at the casual hourly rate.
[2016] FWCA 1215
[6] The Agreement also provides loaded rates of pay which compensate for annual leave
loading, shift penalties, overtime payments and public holiday penalties. These loaded rates
are higher than the corresponding minimum rates of pay under the Awards, being:
| | 12.50% to 13.03% higher for retail employees; |
| | 12.48% to 12.52% higher for meat employees; and |
| | 12.57% to 12.58% higher for road transport employees. |
[7] On 22 February 2016, the Commission wrote to the applicant with respect to the
provisions of clause 4.1.2 – Hours of work – Part Time Employees, and clause 4.1.4 –
Supplementary Additional Hours, of the Agreement. These Agreement provisions do not
match the provisions of the relevant Awards. The applicant was requested to address the
Commission on the operation of these Agreement provisions.
Hours of work – part-time employees
[8] The provisions of clause 4.1.2 – Hours of work – Part Time Employees, allow for the
employer to extend the hours of work of a part-time employee during any roster period
without incurring overtime payments and to decrease the hours of work of a part-time
employee. This clause also provides that the employer will initially seek volunteers for a
change of hours but if volunteer numbers are insufficient, the employer will select the part-
time employees who will have increased or decreased roster hours.
[9] The General Retail Industry Award 2010 and the Meat Industry Award 2010 provide
for part-time employees to have a regular pattern of work with reasonably predictable hours
of work which may be varied in writing. These Awards as well as the Road Transport and
Distribution Award 2010 also provide for part-time employees to be paid overtime rates for
additional hours worked in excess of agreed hours. In addition clause 12.8(c) of the General
Retail Industry Award 2010 provides that part-time employees’ rosters will not be changed to
avoid any award entitlements (including the payment of overtime rates). The Commission
was concerned that the Agreement provisions in clause 4.1.2 do not provide the same
protections as the Awards for part-time employees in relation to their ordinary rostered hours.
Undertaking in relation to part-time employees
[10] In response to the request of the Commission, the applicant provided an undertaking
such that the provisions of clause 4.1.2 of the Agreement highlighted in the Commission’s
correspondence are deleted and replaced with the following: “Part Time Employees will be
provided with a roster on commencement that is reasonably predictable and changes to the
roster will be made in writing and by mutual agreement.”
[11] The undertaking provided by the applicant addresses the Commission’s concerns in
relation to part-time employees. The undertaking is taken to be a term of the Agreement and is
attached at Annexure A of this decision.
[12] The undertaking is not so substantial that if asked to vote again, the employees who
voted would not approve the Agreement. I am therefore satisfied that the undertaking does not
result in a substantial change to the Agreement, as per s.190(3)(b) of the Act.
[2016] FWCA 1215
Voluntary Supplementary Additional Hours
[13] The provisions of clause 4.1.4 – Supplementary Additional Hours, enable employees
to work voluntary Supplementary Additional Hours after they have worked 10 days or more
than 76 hours within a two week cycle and to be paid at the relevant casual hourly rate for this
additional work.
[14] The General Retail Industry Award 2010 and the Meat Industry Award 2010 provide
for payment of overtime at 150% for the first 3 hours on a single day (and for the first 2 hours
under the Road Transport and Distribution Award 2010) and 200% thereafter. The Awards do
not provide for lesser payments to be made to employees who volunteer for additional work.
Payments under the Awards in these circumstances are the same as payments for additional
work performed by employees under direction.
[15] The Commission was concerned about the application of this Agreement provision.
The applicant provided a response that the clause enables employees to volunteer in writing at
their own initiative for Supplementary Additional Hours if they do not have family or other
commitments and that this ability over the busy period is a benefit to staff members. The
applicant also stated that employees cannot be rostered or required to work voluntary
Supplementary Additional Hours and employees must apply in writing at their own initiative
to perform this work. The Commission notes that the provisions of clause 4.1.4 are consistent
with the applicant’s response. The applicant also stated that directed overtime under the
Agreement is paid at the applicable overtime rate.
Consideration of voluntary Supplementary Additional Hours
[16] The Commission’s responsibilities in relation to the assessment of the better off
overall test have been stated consistently in numerous Full Bench and Single Member
Decisions to be a comparison between the terms of the relevant Awards and the terms of the
Agreement. The Commission cannot consider employees’ personal circumstances,
commitments or desire to perform additional work in assessing whether an Agreement passes
the better off overall test.
[17] However during this assessment the Commission is required to apply global reasoning
rather than a line by line comparison of Agreement provisions with the relevant Award
provisions. An Agreement may contain less beneficial provisions where these are balanced by
more beneficial provisions that ensure that employees remain better off overall under the
Agreement. In this application the payments made to employees for performing work under
the voluntary Supplementary Additional Hours provision will be lower than the overtime
payments offered under the relevant Awards. The issue for the Commission to determine is
whether employees will remain better off overall under the Agreement if they volunteer to
perform Supplementary Additional Hours which are paid at the relevant casual hourly rate
rather than the directed overtime rates.
[18] A number of Commission decisions have dealt with the issue of employees working
“voluntary additional hours” which are paid at the ordinary rate. In BUPA Care Services Pty
1
| Ltd and Another | a Full Bench of Fair Work Australia stated: |
“[73] The effect of the preferred hours clauses in each of the Retail Agreements is to
reduce the rate of pay for work on public holidays, Saturday or Sunday or for late night
[2016] FWCA 1215
work or additional hours in certain circumstances from a rate in excess of the basic
hourly rate of pay to the basic hourly rate of pay. This is a financial detriment to an
employee covered by any of the Retail Agreements.”
2
| [19] | In Top End Consulting | , Deputy President Bartel stated: |
“[30] The assessment as to whether an agreement passes the Better Off Overall Test is a
global one. While I am satisfied that the voluntary hours provisions of the Agreement
are less beneficial to the employees than the terms of the modern awards, I am required
to form a view as to whether the Agreement provisions that the employer has identified
as more beneficial to the employees than the reference instruments results in them
being better off overall.
…
[32] I conclude that the more beneficial provisions of the Agreement are not sufficient
to overcome the inferior additional voluntary hours at ordinary time, such that it could
be determined that the employees are better off overall under the Agreement.”
[20] In determining the current application the Commission has had regard to the decisions
referred to above. In these and other cases the Commission has consistently determined that
where ordinary rates were line-ball or only marginally higher than Award rates Agreements
must provide more beneficial provisions to out-weigh the potential disadvantage employees
could suffer in working additional hours paid at ordinary rates.
Undertaking in relation to voluntary Supplementary Additional Hours
[21] The current application can be distinguished from the cases cited above in that
voluntary Supplementary Additional Hours are to be paid at the relevant casual rate rather
than the ordinary rate. The Commission notes however that clause 4.1.4 of the Agreement
does not provide limitations as to maximum numbers of hours that may be worked by
employees as voluntary Supplementary Additional Hours. Given the relatively close margin
of Agreement rates to the minimum rates provided by the Awards the Commission was
concerned that employees who perform voluntary Supplementary Additional Hours may not
be better off overall under the Agreement particularly if this work is regular or frequent.
[22] The Commission requested that the applicant consider providing an undertaking which
specifically addressed this concern. In response to this request, the applicant provided an
undertaking which limits the maximum number of voluntary Supplementary Additional Hours
that may be worked by employees to 8 hours per 152 hour 4-week cycle. The Commission
has conducted an analysis of the Agreement’s rates of pay in conjunction with this limitation
and is satisfied that the limitation imposed by the applicant’s undertaking will ensure that
employees remain better off overall when they seek to access the voluntary Supplementary
Additional Hours provisions.
[23] The undertaking provided by the applicant addresses the Commission’s concerns in
relation to voluntary Supplementary Additional Hours. The undertaking is taken to be a term
of the Agreement and is attached at Annexure B of this decision.
[2016] FWCA 1215
[24] The undertaking is not so substantial that if asked to vote again, the employees who
voted would not approve the Agreement. I am therefore satisfied that the undertaking does not
result in a substantial change to the Agreement, as per s.190(3)(b) of the Act.
Conclusion
[25] Taking into account the higher rates of pay under the Agreement in conjunction with
the applicant’s undertakings at Annexures A and B in relation to part-time employees and
voluntary Supplementary Additional Hours, I am satisfied that employees will be better off
overall under the Agreement.
[26] I am satisfied that each of the requirements of ss.186, 187 and 188 of the Act as are
relevant to this application for approval have been met.
[27] The Agreement is approved. In accordance with s.54(1), the Agreement will operate
from 12 April 2016. The nominal expiry date of the Agreement is 28 February 2020.
DEPUTY PRESIDENT
ANNEXURE A
ANNEXURE B
1
[2010] FWAFB 2762
2
[[2010] FWA 6442
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